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Employment: Vacancy trends reveal growing north-south divide in EU labour market

Vacancy trends in the European labour market indicate a widening gap in job opportunities between northern and southern countries. The latest issue of the European Vacancy Monitor (EVM) reveals a shortage of labour supply in countries such as Austria, Denmark Sweden, Estonia and Latvia, while competition for jobs is increasing in countries such as Greece, Slovakia and Spain. The report also highlights the strengths and weaknesses in the recruitment markets of four Southern countries, and warns that more measures are needed to help young people find skilled jobs and, therefore, boost labour productivity.

The Monitor confirms stagnation in labour demand in the EU in the second quarter of 2013, except for a small increase in the number of job vacancies in the public sector. Overall, recruitment fell by 4%, a larger decline than in the previous quarter. Hiring increased in less than half the countries over the period.

Employment, Social Affairs and Inclusion Commissioner László Andor said: “Diverging job prospects in northern and southern Europe underline mismatches in the European labour market, linked also to Eurozone asymmetries. Labour mobility might help to reduce those imbalances. Tools supporting workers mobility within the European labour market such as EURES are available to help job seekers find job opportunities.”

Special focus on southern Europe

Decline in hiring for services and professionals in Greece, Italy, Portugal and Spain has come to a halt, whilst some increases are reported for agricultural, forestry and fishery workers. Employment opportunities in Southern Europe are concentrated in a few fields, such as health care, sales and administration. On the other hand, the construction sector is the occupation most affected by the crisis, and recovery in this area is expected to show slow progress.

Hiring of young people in the four Southern countries is greatly skewed towards lower skilled occupations in the service sector with significant seasonal demand and high turnover. Furthermore, medium-skilled workers are hired increasingly for lower skilled position, underscoring the over-qualification of the labour force.

To address youth unemployment, the European Commission has proposed the Youth Guarantee, an ambitious EU-wide reform which every EU country has endorsed and must urgently implement. The Youth Guarantee aims to help all jobless people under 25 find employment, continued education, an apprenticeship or traineeship within four months of becoming unemployed or leaving formal education (see MEMO/14/13).

Funding from the EU Structural Funds is also available to address the economic and social challenges Europe faces between now and 2020, including more than €70 billion to be invested in human capital via the European Social Fund (see MEMO/13/1011).

Background

The overall weak economic performance has continuously worsened labour market conditions in the Southern European countries worst hit by the crisis. In the second quarter of 2013, employment fell in Greece (-4.3%), Italy (-1.8%), Portugal (-4.1%) and Spain (-3.6%) in year-to-year figures. In the EU 28, employment fell by -0.4%.

This situation has largely worsened youth unemployment in these countries: in the second quarter of 2013, youth unemployment rate reached59.6% in Greece, 55.7% in Spain, 39.4% in Portugal and 38.9% in Italy. In the EU28, youth unemployment rate in the second quarter of 2013 was 24%, up from 15% in 2008.

Furthermore, the crisis has led to more frequent use of temporary employment contracts. For example, in Italy their share increased from around 60% in 2008 to 70% in 2012-2013. This high incidence of temporary contracts contributed to lower levels of training and skills acquisition, which in turn translates into lower productivity and poorer economic performance. In Southern Europe, the share of lower educated employees is 33%, more than twice the EU average (16%).

 

Source:

http://www.eureporter.co/frontpage/2014/02/24/employment-vacancy-trends-reveal-growing-north-south-divide-in-eu-labour-market/

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